Americans want to "keep Medicaid as it is": survey

WASHINGTON (Reuters) - More than half of Americans do not want Medicaid funding cut and are skeptical of changing how the federal government funds the healthcare program for the poor, according to a Kaiser Family Foundation survey released on Wednesday.

Currently, U.S. states administer Medicaid with partial reimbursements from the federal government. The healthcare reform law passed last year made more people eligible for the program and also increased some rates of reimbursement.

Recently, Republicans in Congress have floated the idea of moving away from reimbursements and toward sending states a set amount of money each year for the program, which can take up a third of a state's budget.

Kaiser's survey found that 60 percent of people "would prefer to keep Medicaid as it is, with the federal government guaranteeing coverage and setting minimum standards for benefits and eligibility."

Only 13 percent supported major reductions in Medicaid spending in order to drive down the U.S. deficit, and 30 percent supported minor reductions.

Medicaid was thrust into the spotlight this week as President Barack Obama's administration and Congress work to close a deal to reduce the deficit by $1 trillion.

In recent talks, negotiators examined Medicaid along with Medicare, the health insurance program for the elderly, saying the two forms of assistance represent nearly a quarter of all federal spending.

Kaiser said Americans have a strong attachment to Medicaid, with about half reporting that someone in their life has received the assistance at some time. It added about 69 million people will be covered by Medicaid this year.

As the recession that began in 2007 drove the U.S. unemployment rate up to 10 percent, many who lost their jobs and employee-sponsored health insurance turned to Medicaid. This created an additional stress for states, which were having to also pay for unemployment compensation while their revenues dropped to the lowest levels in decades.

The 2009 federal stimulus plan pitched in extra money for Medicaid, the last of which will be sent in June.

Some governors, such as Mississippi's Haley Barbour, support the idea of funding Medicaid as a block grant.

Republicans, including the House of Representatives Commerce Committee Chairman Fred Upton and Senate Finance Committee ranking member Orrin Hatch, are calling for reforms to the program to drive down costs.

"We are concerned that the program is failing patients; is a target for waste, fraud, and abuse; and is bankrupting both state and federal governments," the two leaders said in a letter to all 50 governors earlier this week.

Republicans say block grants would also give states more control over the program.

Many Democrats counter the grants would keep the program from responding quickly to a surge in demand such as that seen during the recession. They say that means block grants will leave states paying more for the program.